How Estated CEO Josh Fraser grew Estated to $6.5M revenue and 151 customers in 2024.

folks exciting interview today my guest�� is josh frazier he's building a company���� called estated.com it's a property intelligence�� tool josh you're ready to take us to the top���� let's go all right there's a lot of money out�� there right now and everyone's going to buy���� houses investors included who is using you guys�� is it investors or home buyers consumers directly���� actually our bigger segments are in fintech and�� insure tech so we're working with like blend and���� sofa and state farm and swiss re and usaa and�� companies along those lines on more like the pnc���� insurance side and getting lending and�� mortgages and just trying to speed up���� all those tools because like talking to a�� friend in florida yesterday it took them���� 16 hours to get a mortgage it's like we should�� be able to do this in 60 seconds and so we're���� helping with a lot of the data on the background�� um to build like profiles around those houses for���� mostly insurance and um yeah lending and so how�� many customers like that do you have we have a���� 151 customers as of today amazing okay got�� it so this makes sense and the main model is���� a license oh it's basically a licensing model�� is it sas fee or like per api call or something���� so we have two models we have a�� data license scene which is annual���� contracts um and we update it monthly so we�� still consider it a subscription and profit well���� and then as well we have yeah like a volume based�� subscription for the api interesting and so uh���� how many ap i guess maybe this is our question�� how many api calls hit the system last month josh was just telling me before the call guys that�� he has all this data open and then i asked him a���� question it was like that one question that that�� isn't probably like six to seven million okay now���� we're successful so probably like 20 million�� but there may have been inaccurate addresses���� sent through the system and so um that happens�� a lot if people don't clean their addresses���� especially with user inputted ones so like correct�� ones um are probably in the six to seven million���� range okay okay and so these 151 customers�� what are they paying on average per month���� so the lifetime value in our profitable�� account because i pulled this up for you���� is 54 268 a year average revenue per user is 929�� dollars per month that's on a monthly basis yeah���� so that kind of scales out across the 151 yeah�� for the episode so you're doing about 140 150���� 000 a month in revenue right now exactly we�� are 140 mrr with a 1.68 arr yep yep and how���� has that grown over time where were you last�� year do you remember we ended the year at 900k���� in arr um and so the last thing i see in profit�� well it's march yeah we started january at 77���� so to be at 140 we'll definitely cross over�� like 200 growth this year yeah that's that's���� incredible um where is most like growth coming�� from is it upgrading the same customers to more���� api calls or adding new logos all together�� adding new logos where are you finding them���� uh i come from digital marketing so i have�� pretty good google adwords presence i think���� we have a little bit of thought leadership in�� space as well just with content um but you know���� google adwords and and driving leads from there�� has been really successful for us how much did���� you spend last month on google ads would you�� guess uh 20 22 grand okay so not not well maybe���� a little bit was a 15 of your total revenue so 22�� grand and what will that get you how many leads���� yeah i have my scorecard thanks to sas academy�� here um in june we generated 415 leads okay so���� my admin was actually 29 000. okay um a little�� bit more that so i was that was google adwords���� was probably 22. across facebook linkedin we're�� kind of experimenting a little bit with bing as���� well so 29 total 415 leads average cost per�� lead 72 bucks conversion rate on um turning���� them into customers two percent two percent yeah�� we got eight customers okay got eight customers���� and that's at that 900 a month price point right�� correct okay got it so i mean that i mean that's���� a super healthy i mean can you spend more money�� there that feels like healthy ads been to me���� um yes but i only have one sales person we're�� recruiting we'll be hiring another one here���� right away and then uh we'll we'll keep ramping�� that up but we had uh two sales people turn over���� last month so a little bit of a change well you�� know this is always a trick this is one of the���� heart you know logging it's engineering i see more�� sas founders that getting like the sales motion���� with actual people involved like the reps hired�� onboarded and sticky is really difficult so 100���� it sounds like you're comfortable being vulnerable�� why do those two people quit that recently left���� and how are you thinking about the next one�� what learnings are you taking to the next one���� yeah this was a really good learning experience�� so um one quit because he was an entrepreneur on���� the side and his business got too busy and i kind�� of motivated him to continue working on that so���� almost my fault but i'm proud of them and then the�� second one was once so i had this very experienced���� sales rep liam was in the middle and then we had�� a junior sales rep and so when the middle rep���� quit the disparity between my senior sales rep�� and the junior sales rep was so vast that i���� fired this junior sales rep the next day i was�� like oh my god you're not gonna be able to cut���� it and so now i'm only gonna hire someone from a�� competitor that has five to ten years experience���� and the words i've been using in the interviews�� have been i need you to come in and hit the���� ground running i think as a sas founder with�� we have 12 employees i don't have a lot of time���� for training and so i want people to come in and�� know the language know how to sell already and so���� if i call it i need them to hit the ground running�� and so i'm really only looking at people directly���� from my competitors and we're using a recruiter�� to help us with that interesting what do you pay���� a recruiter to do this sort of thing um about�� 20 of the salary and on an sdr they don't even���� include the commission or ote it's on base which�� was really surprising to me and we found a company���� called lmre tech but they're specifically a prop�� tech recruiting firm and so it's been fantastic���� the resumes that they're sending us are just�� amazing i'm very very happy interesting um���� how do you spell that elomari it's just l�� like the letter it's like an acronym l m r e���� i think it's dot tech and they recruit for�� proptech firms and it's a global company too���� so that's been interesting us being in canada they�� find us candidates in canada the us um even over���� in the uk so it's been uh it's unique i've never�� seen something like this niche that's incredible���� this is like a perfect fit for you guys um�� interesting it's blown me away so far the���� people that they've sent to it a little bit more�� expensive than i would hope i think i'm just���� canadian in british columbia getting used to what�� someone gets paid in new york yeah it's always���� a little surprising to me yeah so what do you�� think like this new hire what do you think their���� base will be and what will their quota target be�� and what will their total on target earnings be���� yeah so we are i have no cap their quotas are�� 1.2 million a year and we pay 10 um so there���� if they achieve that 1.2 million on a 50 to 60�� thousand dollar base they could make it up to 180.���� got it 180 150 to 180 depending because we pay�� out on the schedule of how they sign up so if it's���� like month-to-month subscriptions versus annual�� subscriptions there's a bunch of variability in���� that but like 150 is like ote hopefully that�� makes a lot of sense how do you manage like���� a developer who might hear this interview and�� hear that your new sales reps going to make���� more than them and they're going but i'm the one�� building the technology why don't i get paid more���� hmm that's a great question we have our develop�� i've never been asked that first of all um and we���� do have a lot of transparency within our company�� people do know how much everyone else is making um���� i'm not even sure the developers all understand�� what the ote number is they probably just see the���� base you know like i'm not sure that that acronym�� makes a lot of sense and so but i do think that���� they understand that the sales people are the ones�� they hustle they hustle at a different pace and���� have a different like type of work environment�� whereas the engineers are all it's pretty cushy���� you know they get tasks they get them done�� i know they work hard but it's a little bit���� just of a different environment to work in their�� environment's a lot more comfortable our sales���� people are grinding how many engineers do you have�� uh seven right now are they all in house or did���� you leverage for the outsourced dev team uh there�� are full-time employees but we went work from home���� um covid and then we have decided to go fully�� remote so now we have one in russia one in um���� germany one in brazil and then four in�� british columbia how did you find them���� um another recruiting firm out of vancouver and�� both of them had experience working with the���� stated data which was crazy to me but that's�� a company called van hack and they're like an���� engineering recruitment firm that help�� people globally immigrate to canada and so���� um it's a really cool company i met ilya�� a few years ago 20 model...